Richmond Heights School Board approves certification of deficit

The Richmond Heights School Board has voted to approve a certification of deficit.

At a March 25 special meeting, Treasurer John Scott said acting Treasurer Dan Wilson presented the board with a five-year forecast earlier this year showing that the district is facing a deficit of $1.5 million. The board needed to approve the certification of deficit to move forward with the process to receive an advance from the School District Solvency Assistance Fund.
“The state’s going to come in and verify the numbers,” Scott said. “ If they verify that we are correct, they will advance us $1.5 million by the end of April, middle of May. This process, they say, takes two months, so I have some concerns that the money gets here on time.”
Scott added that the money needs to be paid back in about three to five years without interest.
“What it will do is help the administration, give them more time to make additional cuts,” he said. “So the first year’s not so painful.”
Interim Superintendent Robert A. Mengerink said the district will need to make cuts.
“It’s a loan, they don’t just give you the money, you have to pay it back,” he said. “It still doesn’t solve this problem of the fact that we don’t have enough money for this year, which means we don’t have enough money for next year either unless we do something about it.”
After the state completes its audit, it will determine whether the district is under fiscal caution, fiscal watch or fiscal emergency.
Under fiscal caution, the district will be formally notified and monitored monthly. Fiscal emergency is the “last and most severe stage of a school district’s financial solvency problems,” according to the Auditor of State’s website. Under fiscal watch, a commission is created that “may assume all or part of the powers of the board of education. The commission develops a financial plan to alleviate the school district’s financial crisis.”
In a phone interview March 21, School Board President Bobby Jordan said the district is facing a deficit due to incorrect information given to them by a previous treasurer.
“We were assuming we were operating with ‘x’ amount of dollars, and we found out we weren’t,” he said.
Jordan said he could not release the name of the treasurer.